#internal-controls
Internal Controls
Systems and procedures that safeguard assets, ensure accurate records, and prevent fraud
Related-Party Disclosures Under ASC 850: When Paying Your Spouse's LLC Needs a Footnote
ASC 850 requires four things in the footnote for every material related-party transaction — the nature of the relationship, a description, dollar amounts for each period presented, and any change in how terms were set — and it applies even when the price is fair. This guide identifies who counts as a related party for a small business (10%+ owners, officers, immediate family, and entities they control), shows a model two-paragraph footnote, and gives a 10-step year-end checklist plus a Beancount account structure that turns disclosure into a query.
When Your EIN Gets Stolen: A Small Business Guide to IRS Letters 5263C, 6042C, and Business Identity Theft
IRS Letter 6042C verifies a specific business return; Letter 5263C verifies the entity itself on file from Form SS-4, and both carry a 30-day response window that, if missed, stalls your returns, refunds, and overpayment applications. This guide explains how thieves obtain an EIN, the tax and non-tax red flags that signal fraud, exactly what to fax back in each case, when Form 8822-B is required within 60 days of a responsible-party change, and a monthly-quarterly-annual monitoring routine that catches misuse early.
Parking Garage and Valet Bookkeeping: Reconciling Five Revenue Streams and the 30-Day Client Float
A parking operator's chart of accounts and close process — how to separate transient, monthly permit, corporate, valet, and event revenue, book monthly permits as deferred revenue, back parking tax out of tax-inclusive rates, and hold at least 1.5× one month's gross client collections before signing a management agreement with 30-day remittance terms.
Law Firm Trust Accounting: Why a Three-Way IOLTA Reconciliation Is Your Best Defense Against Bar Discipline
A three-way reconciliation proves the bank statement, trust ledger, and every individual client ledger agree to the penny. It is the monthly process that keeps a pooled IOLTA account compliant with ABA Model Rule 1.15 and out of bar discipline.
How to Stop Deepfake Invoice Fraud: An AP/AR Prevention Guide for Small Businesses
Deepfake fraud cost Arup $25.6 million in one faked video call, and voice cloning now needs just three seconds of audio. This guide shows small businesses how callback verification, two-person approval for banking changes, and periodic vendor-file cleanup stop synthetic vendors, cloned executive voices, and doctored invoices.
How a Trailer Manufacturer's Bankruptcy Shows What Happens When Nobody Is Watching the Books
A Georgia trailer manufacturer's 2026 Chapter 11 filing traces partly to alleged employee theft discovered in 2024. Businesses under 100 employees suffer a median fraud loss of $141,000 per ACFE data — here are the segregation-of-duties controls that catch theft early, and why an auditable ledger matters.
Ghost Employee Fraud: How Fake Payroll Records Drain Small Businesses and the Controls That Catch Them
Ghost employee schemes cost U.S. businesses an estimated $400 billion a year and run a median of 18–30 months before detection. Learn the three common scheme patterns, the red flags already in your payroll data — duplicate bank accounts, unchanged withholding, missing I-9s — and the segregation-of-duties controls that stop them.
AI-Generated Fake Receipts Now Drive Most Expense Fraud: A Small Business Guide
AI-generated receipts jumped from 0% to 70.8% of fraud flags between March 2025 and May 2026, per AppZen data covering 1,471 fake receipts across 174 companies — and the average claim dropped to $101 as fraudsters shifted from a few large fakes to many small ones under auto-approval thresholds.
Church Fund Accounting: How to Manage Restricted and Unrestricted Funds
An estimated $86 billion is lost to fraud inside churches worldwide each year, and most of it starts with one bookkeeping mistake — treating restricted and unrestricted funds as one pool. This guide explains how FASB ASC 958 classifies donor-restricted gifts, the three errors that get church treasurers in trouble, and the monthly habits that keep ministry books compliant and transparent.
KPMG Australia Cut Partner Pay 20% Over an Ethics Scandal. Here's How to Vet Your Own Accountant.
KPMG Australia is preparing to cut over 1,000 of roughly 10,000 jobs and reduce partner pay by up to 20% after admitting it mishandled a 2024 whistleblower complaint alleging misuse of confidential client data. The same five independence threats behind the scandal — self-interest, self-review, advocacy, familiarity, and intimidation — apply to any local CPA firm, and this guide covers the red flags plus a five-step due-diligence checklist (license lookup, peer review report, references, commission disclosure, engagement-letter scope) for vetting your own accountant.
Check Washing Is Back: How to Protect Your Small Business's Accounts Payable From Mail Theft Fraud
Check fraud losses hit roughly $21 billion in 2023 and mail-receptacle theft rose 139% between FY2019 and FY2023. This guide covers the accounts-payable controls that actually stop check washing — positive pay, weekly reconciliation inside the UCC 4-406 window, gel ink, and separating check-writing from reconciliation.
Scrap Metal Recycling Center Bookkeeping: Cash Purchases, Seller IDs, and Form 8300 Compliance
Forty-five states require scrap yards to keep seller-ID records, cash caps run as low as $30 (Washington), and IRS Form 8300 is due within 15 days on cash over $10,000. A practical guide to building a purchase ledger that survives police, state regulator, and IRS scrutiny.